Can Tennessee issue a 'Catholic Charities' specialty license plate and send the proceeds to Catholic Charities of East Tennessee?

Plain-English summary

Representative Vince Dean asked the AG whether Senate Bill 3780/House Bill 3361 would survive constitutional challenge. The bill would have created a new Tennessee specialty earmarked license plate recognizing Catholic Charities, with the proceeds dedicated to Catholic Charities of East Tennessee. AG Cooper concluded the bill would likely violate the federal Establishment Clause and the parallel provision of the Tennessee Constitution.

The reasoning has three layers.

First, a Tennessee specialty license plate is government speech. The Sixth Circuit said so in ACLU v. Bredesen, 441 F.3d 370 (6th Cir. 2006), the case that upheld Tennessee's "Choose Life" plate. When a private citizen drives around with a Tennessee specialty plate on the back of their car, the message on that plate carries the government's stamp. Volunteers disseminate it; the legislature approved it; "there is no reason to doubt that a group's ability to secure a specialty plate amounts to state approval."

Second, Catholic Charities of East Tennessee is, by its own description and structure, a religious entity. Its mission statement is grounded in "the grace of Jesus Christ"; it operates as the social-service arm of the Catholic Diocese of Knoxville; it receives a grant from the Diocese; its current Executive Director is a priest; it identifies its activities as ministry "in line with Catholic Social Thought"; and it is part of the national Catholic Charities USA network, which describes the charities as "an integral part of the Catholic Church." The proposed plate's design includes the charity's emblem, which uses a cross as the "t" in "Charities." There is no realistic way to dress the plate up as religiously neutral.

Third, applying the Establishment Clause "endorsement test" (a refinement of the second prong of Lemon v. Kurtzman articulated by the Sixth Circuit in Adland v. Russ), a reasonable observer would believe both the plate's message and the dedicated funding stream constitute government endorsement of a religious entity. The third prong of Lemon (excessive entanglement) also fails: the State would either have to monitor the charity's use of the funds to make sure they were not spent on religious activities (which would cause the State to intrude into the religion's day-to-day operations) or not monitor at all (in which case state funds would flow to religious activities).

The AG opinion is consistent with two earlier 2009 opinions reaching the same conclusion about specialty plates for the Church of God in Christ (Op. 09-82) and for The Lord's Child charity (Op. 09-110), and with several earlier opinions about direct grants of state money to churches and church-affiliated youth groups.

The practical takeaway for the legislature is that the Establishment Clause restriction on this kind of specialty plate is structural, not cosmetic. It cannot be cured by tweaking the design, and probably cannot be cured by limiting how the proceeds may be spent. The constitutional flaw is the dedicated state-promoted recognition of, and dedicated funding stream to, a religious organization.

Currency note

This opinion was issued in 2010. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The Establishment Clause landscape has shifted significantly since 2010. Recent Supreme Court decisions like Trinity Lutheran Church of Columbia v. Comer (2017), Espinoza v. Montana Department of Revenue (2020), Carson v. Makin (2022), and Kennedy v. Bremerton School District (2022) have reframed the doctrine, including the Lemon test's continued vitality. Anyone analyzing a similar specialty-plate proposal today should re-examine the issue under current Establishment Clause jurisprudence.

Common questions

Q: What is a "specialty earmarked license plate" in Tennessee?
A: An optional license plate authorized by the legislature under Tenn. Code Ann. § 55-4-201 et seq. that promotes a particular cause, organization, or message. The motorist pays an extra fee to display the plate. A portion of that fee is "earmarked" — dedicated by statute to a particular beneficiary organization rather than going to the general state highway fund. Tennessee has dozens of these plates (universities, military service branches, conservation groups, charities, sports teams).

Q: Why is the message on the plate considered "government speech"?
A: Because the legislature decides which plates to authorize, the State manufactures and issues them, and the State controls the design. The Sixth Circuit in ACLU v. Bredesen treated specialty-plate messages as state-approved government communications even though private drivers display them. The Supreme Court later took a similar position in Walker v. Texas Division, Sons of Confederate Veterans (2015).

Q: If "Choose Life" plates are constitutional, why aren't Catholic Charities plates?
A: "Choose Life" expresses a controversial viewpoint, but it is not the establishment of a religion. The Establishment Clause is a separate constraint that targets government endorsement of, or aid to, religious institutions. A pro-life message can come from secular as well as religious people; an explicitly religious institutional sponsor cannot.

Q: Could the legislature avoid the problem by using a generic charity name?
A: That depends on the design and the funding flow. The Establishment Clause problem here is twofold: (1) state recognition of a particular religious institution and (2) a dedicated stream of state-collected revenue to that institution. A plate that recognized a secular cause (say, "feed the hungry") and let any qualifying nonprofit (religious or secular) apply for funds on neutral terms would have a much stronger constitutional footing. A plate naming a specific religious organization and paying out only to that organization is the version the AG flagged.

Q: Could Catholic Charities receive state money if the plate program required the funds be used only for secular purposes?
A: That is exactly the entanglement problem the opinion identifies. To enforce a "no-religious-uses" condition, the State would have to monitor the charity's spending closely, which is itself an Establishment Clause concern under the third prong of Lemon. The Supreme Court has struggled with this since at least Lemon v. Kurtzman (1971); the AG cites Committee for Public Ed. and Religious Liberty v. Nyquist (1973) and Bowen v. Kendrick (1988).

Q: Does this analysis prevent religiously affiliated charities from ever receiving state funds?
A: No. Religiously affiliated organizations can receive state funds for genuinely secular services (think hospitals, food pantries, addiction programs) under neutral, generally available funding programs. The constitutional problem here is the targeted, named, dedicated nature of the specialty plate. It is the singling out, not the recipient's religious affiliation, that drives the analysis.

Q: What did the legislature actually do with this bill?
A: This opinion is about the bill's likely constitutional fate if enacted. Whether the legislature ultimately passed the plate (or modified it to address the AG's concerns) is a separate legislative-history question that requires checking the General Assembly's records for the 106th General Assembly.

Background and statutory framework

Tennessee's specialty-plate program is codified at Tenn. Code Ann. § 55-4-201 et seq. The General Assembly authorizes each new plate by separate legislation. The motorist pays the standard registration fee plus an additional specialty-plate fee. A portion of the specialty fee is "earmarked" to a particular beneficiary, with the allocation set by Tenn. Code Ann. § 55-4-215. The Department of Revenue (specifically the Vehicle Services Division) handles design approval, issuance, and remittance to the beneficiary.

Senate Bill 3780/House Bill 3361 in the 106th General Assembly proposed a Catholic Charities plate. The plate would carry "an appropriate logo or other design representative of Catholic Charities and its mission" (the AG opinion's footnote 1 notes that the charity's emblem uses a cross as the "t" in Charities, with the cross arms wrapping around the adjacent letters). Proceeds would flow exclusively to Catholic Charities of East Tennessee.

The Establishment Clause analysis runs through three steps. First, courts ask whether the law facially differentiates among religions (Hernandez v. Commissioner of Internal Revenue, 490 U.S. 680 (1989)). A plate naming a particular Catholic charity and funding only that Catholic charity differentiates by denomination on its face. Second, courts apply the three-part Lemon test: secular legislative purpose, primary effect that neither advances nor inhibits religion, and absence of excessive government entanglement with religion. Third, in the Sixth Circuit, Lemon's second prong is refined into the "endorsement test" articulated in Adland v. Russ, 307 F.3d 471 (6th Cir. 2002): would a reasonable observer believe the government action endorses religion?

The AG concludes the proposed Catholic Charities plate fails both the second prong (endorsement: a reasonable observer sees the plate as state recognition and state funding of a Catholic religious organization) and the third prong (entanglement: any meaningful state oversight of the charity's spending of the earmarked funds would intrude into the religion's day-to-day operations).

The Sixth Circuit's "government speech" framing of specialty plates in ACLU v. Bredesen, 441 F.3d 370 (6th Cir. 2006), is critical here. If the plate were treated as private speech, the Establishment Clause analysis would be different (the State would be a forum operator, not a speaker, and Free Speech Clause neutrality principles might cut the other way). Because the message is government speech, the State is the speaker, and the Establishment Clause limits what the State can say. That single doctrinal move (Choose Life as government speech) ends up being decisive in ruling out the Catholic Charities plate.

The Tennessee Constitution's Article I, § 3 ("no preference shall ever be given, by law, to any religious establishment or mode of worship") is generally read by Tennessee courts in parallel with the federal Establishment Clause and would support the same conclusion.

Citations and references

Statutes and constitutional provisions:

• Tenn. Code Ann. § 55-4-201 et seq. (Specialty Earmarked License Plates)
• Tenn. Code Ann. § 55-4-215 (allocation of proceeds)
• U.S. Const. amend. I (Establishment Clause)
• U.S. Const. amend. XIV (incorporation against the states)
• Tenn. Const. art. I, § 3 (no preference for any religious establishment)

Cases:

• ACLU v. Bredesen, 441 F.3d 370 (6th Cir. 2006), cert. denied, 548 U.S. 906 (2006), federal court of appeals (Tennessee specialty plates are government speech)
• Lee v. Weisman, 505 U.S. 577 (1992), U.S. Supreme Court (Establishment Clause coercion principle)
• Everson v. Board of Education of Ewing Township, 330 U.S. 1 (1947), U.S. Supreme Court (no aid to one religion or all religions)
• Hernandez v. Commissioner of Internal Revenue, 490 U.S. 680 (1989), U.S. Supreme Court (denominational preference inquiry)
• Lemon v. Kurtzman, 403 U.S. 602 (1971), U.S. Supreme Court (three-part Establishment Clause test)
• Van Orden v. Perry, 545 U.S. 677 (2005), U.S. Supreme Court (Lemon "not useful" for Ten Commandments display)
• Adland v. Russ, 307 F.3d 471 (6th Cir. 2002), cert. denied, 538 U.S. 999 (2003), federal court of appeals (endorsement test)
• Committee for Public Ed. and Religious Liberty v. Nyquist, 413 U.S. 756 (1973), U.S. Supreme Court (entanglement)
• Bowen v. Kendrick, 487 U.S. 589 (1988), U.S. Supreme Court (entanglement in monitoring religiously affiliated grantees)

Prior AG opinions:

• Op. Tenn. Att'y Gen. 09-82 (May 13, 2009) (specialty plate for Church of God in Christ unconstitutional)
• Op. Tenn. Att'y Gen. 09-110 (June 8, 2009) (specialty plate for The Lord's Child unconstitutional)
• Op. Tenn. Att'y Gen. 08-58 (March 18, 2008) (Community Enhancement Grant Program direct payments to church or church youth group unconstitutional)
• Op. Tenn. Att'y Gen. 07-94 (June 12, 2007) (unrestricted state grants to churches and church-affiliated youth groups unconstitutional)
• Op. Tenn. Att'y Gen. 09-59 (April 16, 2009) (sale or lease of state property to religious group without competitive procurement vulnerable)
• Op. Tenn. Att'y Gen. 08-154 (October 3, 2008) (utility district may exclude churches from voluntary-donation grant program)

Source

• Landing page: https://www.tn.gov/attorneygeneral/opinions.html
• Original PDF: https://www.tn.gov/content/dam/tn/attorneygeneral/documents/ops/2010/op10-034.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain, the linked PDF is authoritative.

March 16, 2010

Opinion No. 10-34

Establishment of New Specialty Earmarked License Plate Recognizing Catholic Charities

QUESTION

Would the establishment of a new specialty earmarked license plate, pursuant to Tenn. Code Ann. § 55-4-201, et seq., recognizing Catholic Charities and allocating certain proceeds from the sale of the new plate exclusively to further the mission of Catholic Charities of East Tennessee violate any federal or state constitutional provisions?

OPINION

Yes, we think a court would conclude that the establishment of a new specialty earmarked license plate recognizing Catholic Charities and allocating certain proceeds from the sale of the new plate exclusively to further the mission of Catholic Charities of East Tennessee violates the federal and state constitutional provisions against the establishment of religion.

ANALYSIS

This Office has been asked to assess the constitutional validity of Senate Bill 3780/House Bill 3361 currently pending before the legislature. This proposed legislation would authorize the issuance of a new specialty earmarked license plate, pursuant to Tenn. Code Ann. § 55-4-201, et. seq., which recognizes Catholic Charities. "The new specialty license plate ... shall contain an appropriate logo or other design representative of Catholic Charities and its mission."¹ Senate Bill 3780/House Bill 3361, Section 2(b). The funds produced from the sale of the new specialty earmarked license plates "shall be allocated to Catholic Charities of East Tennessee in accordance with [Tenn. Code Ann.] § 55-4-215." Id., Section 2(c).

The analysis in prior Attorney General opinions concerning similar specialty earmarked license plates is applicable here. In Op. Tenn. Att'y Gen. 09-82 (May 13, 2009), this Office opined that, under current law, a court would conclude that the establishment of a new specialty earmarked license plate recognizing a specific religious entity would be found by a court to violate the federal and state constitutional provisions prohibiting the establishment of religion. Proceeds from the sale of the proposed specialty earmarked license plate recognizing the Church of God in Christ would have been used exclusively to further the mission of that church's charities.² Likewise, In Op. Tenn. Att'y Gen. 09-110 (June 8, 2009), this Office opined that a court would conclude that the establishment of a new specialty earmarked license plate recognizing a specific religious charity, The Lord's Child, would be found by a court to violate the federal and state constitutional provisions prohibiting the establishment of religion.

In upholding the validity of Tennessee's statutory scheme for specialty license plates in the context of the legislature's having authorized such a plate with a "Choose Life" inscription, the Sixth Circuit found that the message on the specialty license plate represents government speech for purposes of the Free Speech Clause of the First Amendment. ACLU v. Bredesen, 441 F.3d 370, 375-380 (6th Cir. 2006), cert. denied, 548 U.S. 906 (2006). The Sixth Circuit noted that the governmental message is disseminated by the volunteers who display the specialty tags on their private vehicles. Id. at 377-380. The court further noted that "there is no reason to doubt that a group's ability to secure a specialty plate amounts to state approval." Id. at 376.

The Establishment Clause of the First Amendment to the United States Constitution provides that "Congress shall make no law respecting an establishment of religion[.]" The First Amendment is applicable to the states through operation of the Fourteenth Amendment. At a minimum, the First Amendment guarantees that the government may not coerce anyone to support or participate in a religion or its exercise, or otherwise act in a way that establishes a state religion or religious faith or which tends to do so. Lee v. Weisman, 505 U.S. 577 (1992). Similarly, Article I, Section 3, of the Tennessee Constitution provides that "no preference shall ever be given, by law, to any religious establishment or mode of worship." In Everson v. Board of Ed. of Ewing, 330 U.S. 1, 15-16 (1947), the Supreme Court stated that the Establishment Clause means that neither a state nor the federal government may "pass laws which aid one religion, aid all religions, or prefer one religion over another." No tax, in any amount, large or small, can be levied to support any religious activities or institutions, whatever they may be called or whatever form they may adopt to teach or practice religion. Id.

Courts use the following guidelines to determine whether government aid violates the Establishment Clause. First, when it is claimed that a denominational preference exists, the initial inquiry is whether the law facially differentiates among religions. Hernandez v. Commissioner of Internal Revenue, 490 U.S. 680 (1989). As we noted in Op. Tenn. Att'y Gen. 07-94 (June 12, 2007), if grants are made only to churches of a particular denomination, the grants could be found to fail this test. Second, if no such facial preference exists, courts frequently use a three-part test articulated in Lemon v. Kurtzman, 403 U.S. 602 (1971). Under this test, the criteria to be examined in determining whether a statute violates the Establishment Clause are: (1) whether the statute has a secular legislative purpose; (2) whether its primary effect is one that neither advances nor inhibits religion; and (3) whether it fosters excessive government entanglement with religion. The Lemon test has been criticized in some cases. See, e.g., Van Orden v. Perry, 545 U.S. 677, 685-86 (2005). In that case, the Court found that the Lemon test was "not useful" in determining whether a display of the Ten Commandments on the Texas Capitol grounds violated the Establishment Clause. Id. At the same time, the Court did not reject use of the test in other contexts. We think the Lemon test still applies in determining whether an express recognition of or direct payments to a religious institution violates the Establishment Clause. Under Lemon as later refined in what is known as the "endorsement test," courts look to whether a reasonable observer would believe that a particular action constitutes an endorsement of religion by the government. Adland v. Russ, 307 F.3d 471, 479 (6th Cir. 2002), cert. denied, 538 U.S. 999 (2003) ("endorsement test" is a refinement of the second prong of the Lemon test).

The proposed legislation is constitutionally suspect under the "endorsement test." Catholic Charities of East Tennessee states in its 2008/2009 Annual Report that it "operates as the social service arm of the Catholic Diocese of Knoxville."³ See http://www.ccetn.org. The website for Catholic Charities USA, which is the national network of charitable organizations in each state, states that the Catholic Charities across the nation are "[a]n integral part of the Catholic Church."⁴ Catholic Charities of East Tennessee receives a grant from the Diocese of Knoxville. The current Executive Director is a priest and pastor in the Catholic Church. As part of the advocacy for the poor and others in need, this organization participates with affiliated organizations that are "in line with our mission statement [and] Catholic Social Thought."⁵ These affiliated organizations include Catholic Charities USA and the Catholic Public Policy Commission of Tennessee, described as "a statewide commission of people chosen by the bishops of our state"⁶ who "provide the public policy voice of the Catholic Church in Tennessee."⁷

We think a court would find that a reasonable observer would believe that the dissemination of this government message on this new specialty earmarked license plate is a governmental endorsement of this particular religiously affiliated entity. Furthermore, we think a court would conclude that a reasonable observer would believe that the direct payments of money under the specialty earmarked license plate program to this religiously affiliated charity constitutes an endorsement of religion by the government. Both the dissemination of the governmental message on the new specialty earmarked plate and the payments, therefore, could fail the "endorsement test" applied by the United States Court of Appeals for the Sixth Circuit under the second prong of the Lemon test.

Further, it is unlikely the program can be structured so that the State could monitor the religious charity receiving funds under the specialty earmarked license plate program to ensure the funds are not used to support religious activities. We think that monitoring direct payments to this religiously affiliated charity to ensure that funds are not used for a religious purpose would cause the State to intrude unduly into the day-to-day operations of the religion in violation of the third prong of the Lemon test. See, e.g., Committee for Public Ed. and Religious Liberty v. Nyquist, 413 U.S. 756 (1973); Bowen v. Kendrick, 487 U.S. 589 (1988). For these reasons, we think a court would conclude that the direct payment of funds to Catholic Charities under the new specialty earmarked license plate program would violate the Establishment Clause of the United States Constitution.

ROBERT E. COOPER, JR.
Attorney General and Reporter

MICHAEL E. MOORE
Solicitor General

STEVEN A. HART
Special Counsel

Requested by:

The Honorable Vince Dean
State Representative
107 War Memorial Building
Nashville, Tennessee 37243

¹ The emblem for Catholic Charities of East Tennessee, Inc., includes a cross as the "t" in Charities, with arms of the cross wrapped around each adjacent "i." http://www.ccetn.org.

² In Op. Tenn. Att'y Gen. 08-58 (March 18, 2008), this Office opined that, under current law, a court would conclude that any direct grant of funds by the State through the Community Enhancement Grant Program to a church or a church youth group would violate the Establishment Clause of the United States Constitution. Similarly, in Op. Tenn. Att'y Gen. 07-94 (June 12, 2007), this Office opined that an unrestricted grant of state funds to churches and youth groups affiliated with churches would also violate the Establishment Clause. See also Op. Tenn. Att'y Gen. 09-59 (April 16, 2009) (sale or lease of state property to a religious group without advertisement or other means of competitive procurement would be vulnerable to attack under the Establishment Clause); Op. Tenn. Att'y Gen. 08-154 (October 3, 2008) (in light of the Establishment Clause, a utility district in its grant program to distribute voluntary donations collected from customers may exclude churches).

³ The organization's Mission Statement is "[e]mpowered by the grace of Jesus Christ, Catholic Charities of East Tennessee addresses the unmet needs of the most vulnerable of our region by providing shelter, nourishment, counseling and education, in order to foster human dignity."

⁴ The Catholic Charities USA website further explains that the charitable work of Catholic Charities is ministry rooted in the scriptures and that Catholic Charities are authorized to exercise their ministry by the diocesan bishop. "Ten Ways Catholic Charities are Catholic." http://www.catholiccharitiesusa.org/NetCommunity/Page.aspx?pid=296.

⁵ http://www.ccetn.org/Catholic_Charities_of_East_Tenn/Advocacy.html.

⁶ Id.

⁷ http://www.tncppc.org.